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Is ‘Getting to Zero’ really feasible? The new Chronic Poverty Report

March 20, 2014

OK, I think we’ll draw a veil over the slightly disappointing migration wonkmassacrewonkfirstroundknockout wonkwar and get on with other stuff.

The latest Chronic Poverty Report (2014-15) was released last week, and I urge you to take a look. It’s a goldmine of analysis, case studies and graphics (too many for this post, I’ll have to tweet the extras). The subtitle, ‘the road to zero extreme poverty’ is an attempt to influence the post2015 discussion, which is increasingly talking about ‘getting to zero’: eradicating extreme poverty for the first time in history, with 2030 a likely target date. For several years, the Chronic Poverty network has been thinking and writing about how to actually do that, so I hope the post2015 crowd listens.

Chronic poverty is different from general poverty: it describes the subset of poor people, (up to 500 million of them), who live permanently below the $1.25 poverty line, often for generations. They consist of a kaleidoscope of excluded groups – children, casual labourers, smallholder farmers, disabled people, indigenous minorities, downtrodden castes, widows, remote communities, the elderly, people with mental health problems, and often an intersecting combination of these.

The standard development recipe of growth + jobs may work for some of these, but not all. How do you help a disabled elderly woman escape from poverty? Microfinance or job creation aren’t going to do the trick: previous reports have stressed the importance of social protection and public services. This one adds more on ending discrimination and the social norms that justify it.

But the most striking message I took away from this report is actually not strictly about chronic poverty. Household-panel surveys in many countries now allow you to track households over a number of years. They show a strikingly high percentage of families that escape from poverty, only to fall back (see chart). The report argues that preventing people falling back in this way is a ‘low hanging fruit’ in poverty reduction, often ignored by policy makers and donors.

This picture of volatility (nicely illustrated with some very powerful life histories dotted around the report) means that in some countries, it may be more effective to concentrate on preventing escapees from falling back, while in others, helping them escape in the first place may be a better investment. The report suggests policies for different combinations of poverty and ‘impoverishment’ (risk of falling back) – see table.

The report doesn’t stop there, it also looks at how to maintain the escape from poverty of those that escape for good (after all, who would want to get to $1.26 a day and stay there?). Policies should pursue three separate but interdependent objectives – the zero poverty ‘tripod’’: tackling chronic poverty, stopping impoverishment (sliding back) and sustaining poverty escapes.

The report argues that ‘There are three policies that address all three legs of this tripod. All three are needed if the eradication of extreme poverty is to be sustained, and all three require massive global investment. They are social assistance, education and pro-poorest economic growth. For other, more leg-specific policies, see graphic.

This is where, for me, the report loses its focus a bit, and the launch meeting in which I took part last week only confirmed these doubts. Sure, if you want to get to zero and stay there, you have to attack all 3 legs of the tripod with equal zeal. But in practice, governments and donors have only limited cash, and it seems to me entirely plausible that there are trade-offs between the three pillars of the tripod. So even if they are well intentioned, decision makers are bound to ask ‘what will give us the most poverty reduction for our buck?’ My reading of this report is that in some contexts, its answer would be that prevention (stopping people sliding back) provides a better social return on investment than cure (getting previously poor people above the poverty line). The report may have scored on own goal, inadvertently making the case for not targeting the chronically poor in some situations.

I think it was pushed in this direction both by the fascinating findings from the panel data, and the urge to hop aboard the post2015 bandwagon (you probably know what I think about that one). When I asked ODI’s Andrew Shepherd, the lead author of the report, he acknowledged ‘we strayed deliberately because of Getting to Zero’. But as far as I can see, they didn’t have to. It would have been fine to say ‘if you want to get to zero, there is a huge obstacle you have to overcome – chronic poverty. Here’s what you have to do for that elderly, disabled woman and the 500 million like her. The report could have developed some of its really interesting thinking on tackling the social norms that underpin exclusion and policy neglect, or its concept of ‘pro poorest economic growth’ (focussed on informal economy and migrant labourers).

Instead, including both the churners and the escapers has turned the report into a report about poverty and development in general. It’s actually a rather good one at that, but lots of other people cover that ground, and I regret the loss of focus on the chronically poor.

The launch debate highlighted another intriguing gap in the report. Following on from its definition of extreme poverty as less than $1.25 per head, it has a rather individualistic vision of the problem. It discusses collective action as a means to reduce poverty, but does not see association as an aspect of well being – it doesn’t seem that interested in issues of association (families, communities, social capital).

Don’t get me wrong, the report is a must read, breaking lots of new grounds, with a strong focus on government action (aid is a relatively minor presence), the need to understand the political economy of marginalization, and skilfully bridges the humanitarian and development siloes, while bringing in perspectives from economics and anthropology (when was the last time you saw witchcraft mentioned in one of these reports?).

I hope once the post2015 circus moves on, the Chronic Poverty team can get back to its core business. How about the next report being on the cultural norms and practices underpinning chronic poverty, building on whatever comes out of this year’s World Development Report (on Mind and Culture)?

This is a conversational blog written and maintained by Duncan Green, strategic adviser for Oxfam GB and author of ‘From Poverty to Power’. This personal reflection is not intended as a comprehensive statement of Oxfam's agreed policies.

5 comments

HI Duncan, you suggest that “The report may have scored on own goal, inadvertently making the case for not targeting the chronically poor in some situations.” I’d argue this is a good thing. One of the things that I think holds us back in our analysis of poverty is the focus the “kaleidoscope of excluded groups” that not only includes older people, people with disability etc, but also “the poor” themselves (or “chronic poor”, “extreme poor” or any other evolution of the term). As the report recognises, poor people are not all poor all of the time (and the same for the non-poor) – so who exactly do you target?

You might be interested in a paper I wrote that came out yesterday on “Why ‘the poor’ don’t exist…”: http://bit.ly/1paMQd9 that touches on these issues, looking specifically at targeting of social protection.

The real question for me is whether people are (chronically) poor because of who they are (and belonging to a certain “vulnerable group”) or because of what happens to them. If we believe the latter, then surely we need to focus on targeting these things, and not the people.

Duncan I agree with your analysis. Am at launch of the report in Nairobi now, I agree that next Chronic Poverty report should usefully focus on social norms. Many participants here want to see much more discussion and analysis on political economy particularly at the national leadership level which contribute to chronic poverty. What arguments and scenarios will convince leaders to implementation of pro poor policies are actually implemented? What practices within governments and elites contribute to exclusion of the poor from the economy? Not sure that DI are best placed to undertake this kind of political economy study

I also thought a greater age and gender analysis would be helpful, are we not seeing young (although ageing) urban poverty and older rural poverty? And what does this mean for policy making.

Duncan, it is really great to have your feedback on the report, and you certainly struck a chord (or two). Here are my thoughts in response (apologies to the readers for long comment).
First, on the individualistic world view and the neglect on the meso level of the analysis. That is a feature of the report that strongly depends on the main methodologies employed: panel data and life histories, which use the individual or the household as unit of data collection and analysis.
I am strongly convinced of the importance of that ‘meso level’. As the level where individual incentives, social practices and politics interact, it is where most change happens, and the level that policies should target. However, to my knowledge there aren’t many methodologies around that offer a blueprint to explore this level, especially in relation to poverty (and RCTs an behavioural economics, which I suspect will feature strongly in the next WDR, certainly don’t go in that direction). So yes, maybe we should really write the next report on cultural norms and practice, paying attention to the meso level.

On the risk to lose focus on the chronic poor if you take seriously the statement that to get to zero poverty you need to tackle chronic poverty, stop impoverishment, and sustain poverty escapes (the ‘tripod-approach’). Yes, that is a possibility, to the extent that public policy always faces trade-offs that come from financial constraints. Probably this is not sufficiently acknowledged in the report, although we do say that each country should identify its own priorities and policy mix according to the nature of its poverty dynamics.
But more importantly, I think that the ‘tripod-approach’ does more than saying that prevention is as important as cure. It reminds us that chronic poverty is not an issue separated from other problems, one that can be solved without addressing how the national and international socio-economic system works – which ultimately is what you need to do if you want to address the other legs of the tripod.
Consider pro-poorest economic growth. If you take it seriously (as we urge governments to do), it is about changing a country’s political economy (intended as economic power relations): creating jobs, developing financial services for the poor (savings and insurance before credit), restructuring value chains, reforming land tenure. All this involves much more than the chronic poor alone. Similarly, doing proper social assistance and universal health coverage is a matter of politics. Even to guarantee a pension to the disabled old lady you need (bear with me) a certain type of political settlement (political alliances and social contract if you prefer). Not to mention that she is more likely to enjoy that pension all for herself if all her children and grandchildren are in good health, have a job and visit her at week-ends.
I think that the post-2015 discussion would benefit from a message that strongly says that there is still a lot to be done and to be changed to eradicate poverty, in aid as well as in domestic policies.

Chiara (one of the report’s authors, but my view here does not necessarily reflect that of CPAN team)

I like what you say about the importance of ‘cultural norms and practices.’ Culture does matter and one may become less poor but remain ‘untransformed.’ This is part of the core of what I try to reveal in my African Trilogy. I hope you received the first book. “Africa’s Embrace,” in this trilogy that I sent to you.

Hi Duncan,
Thanks for this – interesting stuff. But I’m surprised that you didn’t pick out the relationship between conflict and poverty. The report rightly cites conflict as one of the common causes of impoverishment as well as ‘the biggest challenge’ for the poorest countries to deal with. It goes on to say that ‘conflicts keep people poor, cause impoverishment, and reduce the political space to implement anti-poverty interventions’. With an estimated half of the world’s poor set to live in fragile states by 2015 (http://www.oecd.org/dac/incaf/factsheet20201320resource20flows20final.pdf), dealing with conflict and fragility is arguably the greatest stumbling block to getting to zero on extreme poverty.

This is a conversational blog written and maintained by Duncan Green, strategic adviser for Oxfam GB and author of ‘From Poverty to Power’. This personal reflection is not intended as a comprehensive statement of Oxfam's agreed policies.